LOW earnings beats expectations????

I guess expectations of being unemployed and homeless are easy to beat. The literally cool thing is the majority of their sales came from seasonal and freezers. Is the consumer spending money to save money by dining at home? Time to sell restaurant stocks...

Lowe's earnings:

• EPS declined 4.5% to $0.64 vs $0.67 in 2nd quarter
• Earnings vs. same period last year down 7.9%
• Same store sales 2nd quarter down 5.3% versus same quarter 2007
• Same store sales first half 2008 declined 6.7%
• 6 months ended 8/1/08 net earnings declined 12.1% to $1.54 billion
• Third quarter sales growth at 1% to 2%
• Third quarter EPS of 27 cent to 31 cents
• Full year of 2008 Lowe's expects earnings per share of $1.48 to $1.55
  
  
  
  "The challenging sales environment we have been experiencing for the pastsix quarters continued into the first quarter of 2008, and increasingfinancial pressures on consumers resulted in top-line sales that fell belowour plan," commented Robert A. Niblock, Lowe's chairman and CEO. "Thegenerally poor economic outlook, including well-known housing pressures,rising food and fuel prices and a more negative employment picture erodedconsumer confidence and impacted discretionary purchases for the home. "With our offering of great products and exceptional service, Lowe'scontinued to gain market share in the quarter, and diligent expense controlhelped us achieve respectable earnings in spite of the headwinds facing theindustry," Niblock continued. "Fiscal 2008 will be a challenging year on manyfronts, but we remain focused on what we can control and will continuemanaging for long-term success and pursuing opportunities as they arise in thecurrent environment." During the quarter, Lowe's opened 20 new stores. As of May 2, 2008,Lowe's operated 1,554 stores in the United States and Canada representing176.4 million square feet of retail selling space, an 11.1 percent increaseover last year.

"Our sales results for the quarter, while better than our forecast, reflect the realities of the continuing macro economic pressures on our industry," commented Robert A. Niblock, Lowe's chairman and CEO. "We saw relative strength in our seasonal sales as homeowners welcomed back spring and restored lawns and outdoor landscaping following the effects of last year's drought in much of the country. In addition, we believe our second quarter sales benefited from the economic impact of the fiscal stimulus tax rebates. Unfortunately, weakness in bigger ticket projects continues, particularly in markets most impacted by the housing downturn.

"Through disciplined expense controls we delivered solid earnings for the quarter," Niblock added. "We are encouraged by our results and our continued market share gains, but the macro economic factors pressuring consumers and the ongoing challenges and uncertainty of the financial markets suggest a cautious sales forecast for the balance of fiscal 2008 is prudent. We remain focused on positioning the company for long-term success while managing through the near-term challenges of the current environment."

During the quarter, Lowe's opened 23 new stores. As of August 1, 2008, Lowe's operated 1,577 stores in the United States and Canada representing 178.6 million square feet of retail selling space, a 10.5 percent increase over last year.

Lowe's Business Outlook Third Quarter 2008 (comparisons to third quarter 2007) -- The company expects to open approximately 38 new stores reflecting square footage growth of approximately 10 percent

-- Total sales are expected to increase 1 to 2 percent

-- The company expects comparable store sales to decline 5 to 7 percent

-- Earnings before interest and taxes as a percentage of sales (operating margin) is expected to decline approximately 290 basis points driven by the cycling of last year's $112 million reduction in self-insurance reserves for workers compensation and general liability claims in addition to payroll, fixed cost and depreciation deleverage

-- Store opening costs are expected to be approximately $34 million -- Diluted earnings per share of $0.27 to $0.31 are expected

-- Lowe's third quarter ends on October 31, 2008 with operating results to be publicly released on Monday, November 17, 2008 Fiscal Year 2008 (comparisons to fiscal year 2007)

-- The company expects to open approximately 120 stores in 2008 reflecting total square footage growth of 7 to 8 percent -- Total sales are expected to increase approximately 1 percent

-- The company expects comparable store sales to decline 6 to 7 percent -- Earnings before interest and taxes as a percentage of sales (operating margin) is expected to decline approximately 180 basis points -- Store opening costs are expected to be approximately $97 million -- Diluted earnings per share of $1.48 to $1.56 are expected for the fiscal year ending January 30, 2009